Employee Relations Best Practices
Many marine dealerships find difficulty with rewarding their employees. At Lynnhaven Marine
(Ranked 25) ownership has become incredibly creative with their reward programs, handing out
numerous awards throughout the year. One of the most innovative programs the company uses,
the Dockhand Contest, not only recognizes employees but also helps drive customer satisfaction,
as well. Boatel and docking customers are given ballots to write in the name of the employee that
the customer believes gave them the best service. Each month, then, the employee with the most
number of votes receives $250; second place is awarded $150 and third place receives $75. In
addition, to encourage participation, the company also draws a voting customer‘s name from the
ballots, and the winning customer receives a free month in the boatel. ―The award has resulted in
a much more enthusiastic dockhand staff when helping customers,‖ the company says. ―This is a
low-cost way to improve customer service in the marina.‖
Cost-containment can be the most difficult process for a dealership to undertake, especially given
that a dealer‘s No. 1 costs are personnel related. But the hardest decisions that JOA made were
much easier because it was able to take the bias out of its employee-related cutbacks.
JOA employed the Omnia Profile, a personality-profiling tool, to help determine the strengths and
weaknesses of each team member. Through the system, JOA has re-evaluated each key
employee. And while the net result is that the company was able to methodically lower its payroll
expenses by more than 40 percent — more than $1 million — it was also able to discover hidden
talents in existing employees, giving it the opportunity to combine job responsibilities and in some
cases, give key employees a raise in an otherwise economically difficult time.
―If we moved simply to cut payroll based on pay rate, or production, you can get so low on bodies
that are not qualified that you miss any opportunity you may have had to do some much-needed
business,‖ Matthews says. ―In this environment, employees need to wear many hats. With this
profiling method, we can find out who is capable of wearing what hats. I find it critical to test to
find out who can achieve this multitasking while maintaining a work ethic that is critical to team
morale and customer service at the highest level.‖
It‘s no secret that times have been tough in Florida. Many dealers throughout the state have been
forced to close their doors and for those who remain, for the most part, it has been a process of
hunkering down and riding out the storm.
Not at Liquid Sports, however. In the face of these challenging times, this four-location dealer has
chosen to focus on the things it can control, and in doing so has made ―some of the most
dramatic improvements in processes and procedures that we have ever made,‖ explains owner
Teressa Watts.
On top of adding a fourth location — a significant move in light of the local economy — the
company focused in on a series of employee-oriented moves that have strengthened the overall
company in numerous way.
The company says it made a significant investment in obtaining top talent by hiring the best three
employees it has ever had in three key positions: master technician, service director and
accountant. The tech makes more money for the company due to his knowledge and work ethic;
the service director replaced three people and completes more work of a better quality than any
service person the company has ever had — ―the service department has never run so smoothly
or been so organized, and the customers are noticing it daily,‖ says Watts — and the accountant
has brought the company‘s accounting to an even more granular level than ever before.
Liquid Sports also now uses two methods by which its employees help improve the overall
processes and procedures. First, it launched employee focus groups whereby bonuses are given
out based on new ideas that are generated that improve the company‘s service, bottom line,
customer satisfaction or other areas. And second, it launched a ―fresh eyes review,‖ during which
new employees, after about 30 days on the job, are requested to let management know what they
see at the company that is good, bad or needs improvement.
―It is amazing what a different set of eyes can uncover about inefficiencies in your business that
you never thought of previously,‖ Watts explains.
―The amazing thing with this past year is that while there are challenges and revenue is down, we
have found so many bright areas to exploit which have even higher profit margins than new
boats.‖
When McMachen Marine was a Sea Ray dealer several years ago, it developed an employee
handbook as part of the manufacturer certification process.
The dealership has undergone numerous, often painful changes over the past three years,
shrinking from three locations to one and 75 employees to 18 as the Harrison Township, Mich.based dealership‘s fortunes rise and fall with those of the U.S. automotive industry in this Detroit
suburb.
Despite the drastic downsizing, McMachen Marine believes in the power of the employee
handbook to bring clarity to workers, says Mark McMachen, general manager. ―It puts everything
in black and white so there‘s no grey area,‖ McMachen says. ―Job descriptions are clear, and
employees know what‘s expected of them.‖
The dealership used a template developed by Sea Ray to write its handbook, adapting the
manual to meet its needs. Managers go through the document in the off season, making
adjustments as necessary to keep the handbook current.
McMachen Marine also created a quality control form for use in the service department for
customer follow-up about a week after the service is completed. The form, which has been in use
for many years, ―helps get to the bottom line of things and gauge customer feelings,‖ McMachen
says. ―Calling them goes a long way.‖
The form isn‘t a script that‘s followed to the letter but rather an informal survey of how the repair
went and whether there were any complaints that require follow-up questions. ―We try to keep it
simple and respect our customers‘ time,‖ McMachen says.
The general manager skims through the completed forms weekly, taking remedial action as
required. ―It‘s hard to be perfect, but we try,‖ McMachen says.
Another seemingly simple practice McMachen Marine follows is keeping extra shirts on hand for
everyone who interacts with the boats. Clean and shiny boats don‘t mix well with the grease and
grime that often accompany boat repairs.
What do a package delivery company and a 20th century psychologist have to do with selling and
servicing boats?
Ask Bill Fraine, general manager of Legendary Marine (Ranked 52 in 2006), the five-store dealer
headquartered in Destin, Fla., with locations in the Florida Panhandle and Gulf Shores, Ala.
During a long career at FedEx, Fraine developed a benchmarking philosophy for employees that
carried over to Legendary Marine, where he started the practice in January.
―I learned in my years of leadership that 99 percent of the employees came to work every day to
excel at what they did,‖ Fraine says. ―The reason many fell short of the mark was because they
did not know where the goal line was.‖ That‘s why Fraine developed benchmarks for minimum
expectations. Once employees know what‘s expected of them, most tend to overachieve, he
notes.
To benchmark Legendary Marine, Fraine sat down with department leaders to create and review
satisfactory specs for each job description. The general categories include quality, productivity,
job knowledge, reliability, attendance, independence, creativity, initiative, adherence to policy,
interpersonal relationships and judgment.
When asked whether the system has improved employee productivity and morale, Fraine points
to Abraham Maslow, a psychologist who developed the ―Hierarchy of Human Needs.‖ The
hierarchy is a pyramid divided into deficiency needs and growth needs. Deficiency needs at the
pyramid‘s base include such things as food, clothing, shelter, safety, a sense of belonging and
esteem. Further up the pyramid one finds growth needs, which are fulfilled after deficiency needs
are met and include a need to know and understand, aesthetic needs, self-actualization and
transcendence.
―An employee cannot realize ‗self-actualization‘ (or other needs) if they do not know where they
stand in their work life,‖ Fraine says. ―Many of us derive who we are from what we do.
Understanding clearly how well I am performing allows for confidence and growth. Taking the
time to ensure each employee knows his job expectations and understands his performance level
is the key to success with employees.‖
At Hampton Watercraft & Marine Inc. (Ranked 13 in 2006), the key employees who have stuck by
the owner throughout the company‘s history have been given a share in the company.
Following an early passion for boating, Tony Villareale launched a yacht washing service in junior
high school. This one-man operation blossomed into what is now a multi-million-dollar dealership
boasting more than 40 employees.
But it‘s not how big Hampton Watercraft & Marine Inc. has grown that makes Villareale‘s story so
compelling– it‘s how good it has become.
In an industry in which the biggest player is more than a thousand times larger than the smallest
one, the little guy can suffer in comparison. But not Tony. From the beginning, he has aimed high.
After graduating from college, he went back to his marine business full-time. When buying parts
for a repair job, he overheard that the local Yamaha personal watercraft dealer had dropped the
line, creating an opening in the market. Villareale — who was still living at home — created a
business plan that blew away Yamaha executives, convincing them to choose him over other
established businesses in the area. Then, he overdelivered on it.
That was in 1990. Today, Villareale owns a $13-million, two-location boat dealership in
conjunction with his brother and the handful of key employees who serve as partners. Those
partnerships were Villareale‘s way of rewarding and retaining his business‘ top employees,
something he says is the most significant factor in a company‘s growth.
Similarly, employees at San Diego Sundance Marine (Ranked 36 in 2005) share in the
company‘s success. Service techs get a salary plus a percentage of total revenue, and a stock
ownership plan is in place for key personnel.
The current owners of Midwest Mastercraft (Ranked 35 in 2006) have only been at the
dealership‘s helm for four years, but they have a clear grasp of the connection between their
employees‘ well-being and their dealership‘s success. Since they took over, they‘ve launched a
401K program with a 5-percent company match and provided free health care to all their full-time
team members – a benefits package with which few marine dealers compete. It‘s no surprise then
that Midwest Mastercraft was on track to deliver double digit growth in 2006.
Everyone that works at Hoffmaster‘s Marina (Ranked 54 in 2006) carries ―Eagle Cards,‖ which
they distribute to people they run across in their daily lives who give them great service. The
cards invite them to join the Hoffmaster‘s team and ensure a steady supply of good employees.
The core staff at Rayburn‘s Marine World (Ranked 55 in 2006) meets regularly for voluntary
morning exercise sessions and twice a month the owner‘s family prepares lunch for everyone.
Each practice has helped create a family atmosphere among employees.
Sea Ray of Cincinnati, Louisville & Lexington (Ranked 59 in 2006), a four-location Sea Ray
dealer, uses an outside company to conduct employee surveys to get an untarnished review from
its workforce, and all managers are subject to a 360-degree review process that seeks input from
all employees they interact with.
Glencove Marine (Ranked 87 in 2006) rewards service technicians for their efficiency and loyalty,
paying them a bonus at year‘s end based on productivity and offering employees a 50-percent
401K match and four weeks of vacation after five years of employment.
Surfside 3 (Ranked 3 in 2005 and since purchased by MarineMax Inc.) established a fund to
reward employees for efficiency, exceeding expectations, saving money and increasing
revenues. Through the program, managers nominated employees for a bonus of up to 20 percent
of their weekly income.
Port Harbor Marine‘s (Ranked 13 in 2005) PACE awards recognize employees who exceed
customer or peer expectations
MarineMax Inc. (Ranked 1 in 2005 and 2006) is improving the processes by which its managers‘
success is measured and rewarded. Its adoption of Management By Objectives has involved the
identification of critical success factors, out of which measurable goals are assigned to each
position by quarter and by year. They can range from financial targets and store appearance
goals to CSI scores and number of Getaway trips taken. This new program is already delivering
measurable results.
MarineMax Inc. (Ranked 1 in 2005 and 2006) has dedicated itself to delivering the boating dream.
But the company‘s management has also realized that it can‘t deliver that dream without the right
people. MarineMax has taken the concept of topgrading, the process of filling every position in
the organization with an ―A‖ player at the appropriate compensation level, and made it part of the
company‘s culture. The concept, developed by Bradford D. Smart and Geoffrey H. Smart, is
defined in Brad Smart‘s book, ―Topgrading.‖ According to Smart, an A player is someone who
qualifies among the top 10 percent of those available for a position. A B player is someone in the
next 25 percent and a C player is someone below the top 35 percent.